But a Treasury official said that the Asset Protection Agency, which monitors the Asset Protection Scheme and continues to sift through the bank's books, had the power to seize any assets it finds to be illegal and manage them on the public's behalf.

He said the Treasury could not have analysed the entire portfolio despite eight months of due diligence, adding that the scale of the bank's unknown assets illustrated how poorly it had been run by disgraced former chief executive Sir Fred Goodwin.